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Gold prices rose slightly on Tuesday ahead of a key U.S. Federal Reserve meeting, as speculation that signs of economic turbulence may prompt the central bank to put brakes soon on its monetary tightening cycle kept the dollar under pressure. Spot gold was up 0.2 percent at $1,248.14 per ounce at 0436 GMT, while U.S. gold futures inched 0.1 percent higher to $1,252.2 per ounce. “The U.S. dollar remains the prime mover for gold prices in the current term,” Benjamin Lu, a commodities analyst with

Gold prices rose slightly on Tuesday ahead of a key U.S. Federal Reserve meeting, as speculation that signs of economic turbulence may prompt the central bank to put brakes soon on its monetary tightening cycle kept the dollar under pressure.

The Federal Open Market Committee (FOMC) is widely expected to raise interest rates at its two-day meeting starting later in the day, but the focus will be on its outlook for 2019.

“Investors are hoping gold prices will go up further after the meeting,” said Brian Lan, managing director at dealer GoldSilver Central in Singapore, adding that $1,251 would be the next level that gold will likely test with support at $1,245.

Spot gold was up 0.2 percent at $1,248.14 per ounce at 0436 GMT, while U.S. gold futures inched 0.1 percent higher to $1,252.2 per ounce.

Meanwhile, the dollar index inched lower after losing 0.4 percent on Monday, amid speculation the Fed will soon hit the pause button to its monetary tightening cycle in the face of rising risks to global growth.

Lower interest rates reduce the opportunity cost of holding non-yielding bullion and weigh on the dollar.

“The U.S. dollar remains the prime mover for gold prices in the current term,” Benjamin Lu, a commodities analyst with Phillip Futures in Singapore, said in a note.

U.S. government debt yields fell on Tuesday as investors fled riskier assets and geared up for a key Federal Reserve meeting. The yield on the benchmark 10-year Treasury note sank to 2.825 percent while the yield on the 2-year Treasury bond, the coupon maturity most sensitive to Fed policy expectations, dropped to 2.652 percent. Bond yields move inversely to prices. The big news for traders this week is the Federal Open Market Committee’s (FOMC) upcoming meeting, where the central bank will set

U.S. government debt yields fell on Tuesday as investors fled riskier assets and geared up for a key Federal Reserve meeting.

The yield on the benchmark 10-year Treasury note sank to 2.825 percent while the yield on the 2-year Treasury bond, the coupon maturity most sensitive to Fed policy expectations, dropped to 2.652 percent. Bond yields move inversely to prices.

Stocks have suffered wild bouts of volatility as of late, with the S&P 500 dipping as much as 2 percent on Monday, marking a new low for the index. Major indexes pointed to a marginal recovery on Tuesday however.

The big news for traders this week is the Federal Open Market Committee’s (FOMC) upcoming meeting, where the central bank will set interest rates. The central bank is widely expected to hike rates on Wednesday, however expectations for further rate hikes in 2019 have dampened amid concerns of a potential slowdown in economic growth.

“With one day left to wait on the Fed Rate Decision, it has gotten hard to figure out what the FOMC will do, and even more importantly, what the market wants the FOMC to do,” Kevin Giddis, head of fixed income capital markets at Raymond James, wrote Tuesday.

“The bond market has taken the stance that the Fed has already missed its forecast on inflation, so this must be about keeping the economy from overheating, correct? That works except for the fact that the U.S. economy’s main data pints are getting weaker, rather than stronger,” Giddis added.

Wall Street concerns about “unforeseen consequences” from another Federal Reserve interest rate hike were keeping a lid on Tuesday’s stock market rebound, according to veteran trader Art Cashin. Against the backdrop of higher rates, investors are “very nervous” about global economic growth slowing and uncertainty around the U.S. trade war with China, said the UBS director of floor operations at the New York Stock Exchange. Cashin said there are several investors on the sidelines ahead of the Fed

Against the backdrop of higher rates, investors are “very nervous” about global economic growth slowing and uncertainty around the U.S. trade war with China, said the UBS director of floor operations at the New York Stock Exchange. “They don’t know how much built-in tolerance for rate hikes there are. This is more than the normal amount of nervousness,” he added.

Cashin appeared on CNBC’s “Squawk on the Street” on Tuesday as the Dow Jones Industrial Average was up more than 1 percent in midday trading. He said the Dow appeared to be meeting intraday resistance at around 23,900.

The Dow was bouncing off a two-session plunge of more than 4 percent amid fears that the Fed’s path for higher rates could be too much for the economy and market to handle.

The central bank is expected to raise rates for a fourth time this year at the conclusion of its two-day December policy meeting Wednesday. The Dow, as of Monday’s close, was having its worst December performance since 1980, and was on pace for its worst December start since the Great Depression.

Cashin said there are several investors on the sidelines ahead of the Fed rate increase decision. He added the amount of pushback on the Fed hike, including from President Donald Trump, is “borderline historical.”

Earlier this month, Cashin said he was “quite doubtful” of the three rate hikes that central bankers had projected for 2019 after their September meeting. The market expects a more scaled-back rate path Wednesday.

Brent crude prices slipped on Monday amid concerns over demand in the wake of weaker growth in major economies, while U.S. oil markets held steady after U.S. drilling activity fell to its lowest level in about two months. International Brent crude oil futures were at $60.16 per barrel at 0248 GMT, down 12 cents, or 0.2 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were at $51.33 per barrel, up 13 cents, or 0.3 percent. But oil prices were supported after Genera

Brent crude prices slipped on Monday amid concerns over demand in the wake of weaker growth in major economies, while U.S. oil markets held steady after U.S. drilling activity fell to its lowest level in about two months.

International Brent crude oil futures were at $60.16 per barrel at 0248 GMT, down 12 cents, or 0.2 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $51.33 per barrel, up 13 cents, or 0.3 percent.

Chinese oil refinery throughput in November fell from October, suggesting an easing in oil demand, while the country’s industrial output rose the least in nearly three years as the economy continued to lose momentum.

French business activity plunged unexpectedly into contraction this month, retreating at the fastest pace in over four years, while Germany’s private sector expansion slowed to a four-year low in December.

But oil prices were supported after General Electric Co’s Baker Hughes energy services firm said on Friday that U.S. drillers cut four oil rigs in the week to Dec. 14, pulling the total count to the lowest since mid-October at 873.

“This, when combined with (expectations) Saudi Arabia is … to cut exports to the United States to draw down inventory builds (there) should provide a short-term base despite global slowdown fears, which continue to resonate,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.

However, the current U.S. rig count, which serves as an early indicator of future output, is higher than a year ago when 747 rigs were active.

The Organisation of the Petroleum Exporting Countries and its Russia-led allies have agreed to curb output from January, in a move to be reviewed at a meeting in April. Saudi Arabia is OPEC’s de facto leader.

“The potential for a significant movement in the U.S. dollar clearly has an impact on oil pricing with the Fed meeting (this week). We’re looking outside the oil markets for its next major move,” said Michael McCarthy, chief markets strategist at CMC markets.

The U.S. Federal Open Market Committee (FOMC) is set to start a two-day meeting on Tuesday.

U.S. government debt yields slipped on Monday amid ongoing concerns around a potential slowdown in economic growth and ahead of the Federal Reserve’s December meeting. The yield on the benchmark 10-year Treasury note was slightly lower, trading at 2.868 percent, while the yield on the 30-year Treasury bond fell to 3.124 percent. Bond yields move inversely to prices. Market focus is largely centered on fears around slowing global growth, following the release of weaker-than-expected data from Chi

U.S. government debt yields slipped on Monday amid ongoing concerns around a potential slowdown in economic growth and ahead of the Federal Reserve’s December meeting.

The yield on the benchmark 10-year Treasury note was slightly lower, trading at 2.868 percent, while the yield on the 30-year Treasury bond fell to 3.124 percent. Bond yields move inversely to prices.

Market focus is largely centered on fears around slowing global growth, following the release of weaker-than-expected data from China and Europe on Friday.

Chinese industrial output for November grew 5.4 percent from the previously year, lower than an estimated 5.9 percent, while retail sales rose 8.1 percent last month, falling short of an expected 8.8 percent. European data also disappointed, with the IHS Markit Flash euro zone PMI index falling to 51.7 in December, at its lowest level in four years.

The figures for China particularly weighed on market sentiment, given the unresolved trade war between the U.S. and China. The two nations are attempting to settle their differences within a 90-day truce.

U.S. government debt prices rose on Friday as traders digested fresh economic data out of China and looked ahead to next week’s Federal Reserve meeting. The yield on the benchmark 10-year Treasury note fell steeply to 2.875 percent, while the yield on the 30-year Treasury bond dropped to 3.136 percent. Bond yields move inversely to prices. Investors turned their attention to worse-than-expected Chinese data. News of the disappointing figures comes as China and the U.S. try to negotiate a trade d

U.S. government debt prices rose on Friday as traders digested fresh economic data out of China and looked ahead to next week’s Federal Reserve meeting.

The yield on the benchmark 10-year Treasury note fell steeply to 2.875 percent, while the yield on the 30-year Treasury bond dropped to 3.136 percent. Bond yields move inversely to prices.

Investors turned their attention to worse-than-expected Chinese data. The country’s industrial output in November grew 5.4 percent from the previous year, less than the 5.9 percent estimated by Reuters; retail sales, meanwhile, rose 8.1 percent last month, falling short of an expected 8.8 percent.

News of the disappointing figures comes as China and the U.S. try to negotiate a trade deal within a 90-day tariffs truce. Positive headlines around trade relations between the two had buoyed market sentiment earlier this week.

President Donald Trump said discussions with Beijing had been “very productive” and that some “important announcements” were forthcoming, while a Wall Street Journal report said China was preparing to widen foreign access to its economy.

The Fed is expected to raise interest rates Wednesday by a quarter point, and the pressure is on for Fed Chairman Jerome Powell to sound dovish — but not too dovish. Fed officials are also expected to revisit their fed funds rate forecasts and roll back some of the rate hikes expected in the next several years. “Equities are hoping that the Fed is almost done or [for] signals that they’re going to pause. Robert Sluymer, technical strategist at Fundstrat, said key for the stock market will be how

The Fed may not be able to turn the tide for the stock market in the week ahead, but it could soothe some of the wild volatility that has been crushing stocks since October.

The Fed is expected to raise interest rates Wednesday by a quarter point, and the pressure is on for Fed Chairman Jerome Powell to sound dovish — but not too dovish. Fed officials are also expected to revisit their fed funds rate forecasts and roll back some of the rate hikes expected in the next several years.

“Equities are hoping that the Fed is almost done or [for] signals that they’re going to pause. I think it’s too premature for them to do that,” said George Goncalves, head of fixed income strategy at Nomura. “The Fed was a little too optimistic for next year, and now they’ve got to come down. The recent price action is almost an overshoot on the bearish side.”

The Fed should tweak its economic forecast, and it could note that it has concerns about global growth. Powell is also expected to hold a briefing, where he could discuss Fed officials’ concerns about the impact of trade wars and possibly financial conditions.

There has been some speculation the Fed could hold off on a rate hike Wednesday, but it is widely expected to move forward and use its forecast and dovish tone to ease market fears that it is moving too aggressively.

“Is the change in tone going to be enough to jump-start this market that only reacts to bad news? It may well be. It may be the pivot point,” said Art Hogan, chief market strategist at B. Riley FBR.

Some strategists said if the Fed sparks a rally, there’s a chance stocks could find a near-term bottom.

Robert Sluymer, technical strategist at Fundstrat, said key for the stock market will be how it trades coming out of the Fed meeting. “I think it’s huge,” he said. “A tremendous number of stocks have been selling off through 2018. You have a lot of weak stocks, but they’re also deeply oversold from an intermediate standpoint. … My guess is coming out of the Fed you’re going to see some relief from that.”

Sluymer said the market is testing the lows of its 2018 trading range. The S&P 500 closed at 2,599, off 1.9 percent Friday and 1.2 percent for the week. It is now down 2.8 percent for the year.

“I think the markets want way too much out of the Fed. Market participants want a knight in shining armor,” said Goncalves. Goncalves said Nomura expects the Fed to eliminate one of the rate hikes in its collective forecast for next year, taking it to two instead of three on its so-called “dot plot.”

Trade-war worries and the Fed’s interest rate hikes have topped the list of what’s scaring risk markets and sending buyers into safe havens like Treasurys. On Friday, stocks plunged after a surprise slowing of consumer and industrial data in China, even though U.S. retail sales were strong and economists upped their outlook for fourth-quarter growth to 3 percent.

But the U.S. economy is expected to grow at a slower pace next year, and the Fed is expected to emphasize its policy decisions will be dependent on data. Economists expect growth to fall from about 3 percent to 2.4 percent next year, according to CNBC/Moody’s Analytics rapid GDP update.

“If the Fed sounds overtly too dovish, it sounds like they’re trying to appease the equity market. If they end up being too dovish they run the risk of having us wonder what they know that we don’t know,” said Goncalves.

Patrick Palfrey, equity strategist at Credit Suisse, said the economic outlook and earnings expectations are still solid but the global economy has weakened somewhat and the market has to adjust. “If you look at valuations in the sell-off, what the market is pricing at the moment is a recession, an economic recession or a profit recession. The question is when you look at ISM or the pace of job gains, the question is are they recessionary? And the answer is no,” Palfrey said.

Goncalves said the Fed will be careful not to be too fearful about the economy. “The economy is not yet at a point where you can say clearly that we’re heading for a downfall,” he said.

Besides the Fed in the week ahead, there are a few earnings reports, including Oracle on Monday, Micron and FedEx on Tuesday, and Nike on Thursday.

Economic reports include homebuilders sentiment on Monday, home sales Wednesday and personal income and durable goods Friday.

At a much-anticipated meeting on Thursday, the ECB is poised to bring an end to its crisis-era bond-buying program after nearly four years. European lenders have generally been critical of the central bank’s QE program, arguing it has a negative impact on their net interest income. Deutsche Bank, Unicredit and Intesa Sanpaolo were all trading more than 3 percent higher on the prospect of the ECB ending its contentious stimulus program. It comes after Exane BNP Paribas raised its stock recommenda

Europe’s banking index was the top performer in early morning deals, up more than 1.4 percent with market participants widely expecting the European Central Bank (ECB) to announce the end of quantitative easing (QE) later in the session.

At a much-anticipated meeting on Thursday, the ECB is poised to bring an end to its crisis-era bond-buying program after nearly four years. European lenders have generally been critical of the central bank’s QE program, arguing it has a negative impact on their net interest income. Deutsche Bank, Unicredit and Intesa Sanpaolo were all trading more than 3 percent higher on the prospect of the ECB ending its contentious stimulus program.

Looking at individual stocks, Britain’s Antofagasta surged toward the top of the European benchmark shortly after opening bell. It comes after Exane BNP Paribas raised its stock recommendation to “outperform” Thursday morning, prompting shares of the London-listed stock to rise 3 percent.

Meanwhile, Germany’s Metro slumped to the bottom of the index after the company reported persistently challenging business conditions in Russia. Shares of the wholesale tumbled more than 8 percent on the news.

Oil prices fell along with weak stock markets on Thursday, but trading was tepid ahead of a meeting by producer group OPEC that is expected to result in a supply cut aimed at draining a glut that has pulled down crude prices by 30 percent since October. International Brent crude oil futures were down 7 cents, or 0.1 percent, at $61.49 per barrel. Traders said oil prices were being weighed down by weak global financial markets, which saw stock markets tumble on Thursday. Led by Saudi Arabia, OPEC

Oil prices fell along with weak stock markets on Thursday, but trading was tepid ahead of a meeting by producer group OPEC that is expected to result in a supply cut aimed at draining a glut that has pulled down crude prices by 30 percent since October.

U.S. West Texas Intermediate (WTI) crude futures were at $52.66 per barrel at 0140 GMT, down 23 cents, or 0.4 percent, from their last close.

International Brent crude oil futures were down 7 cents, or 0.1 percent, at $61.49 per barrel.

Traders said oil prices were being weighed down by weak global financial markets, which saw stock markets tumble on Thursday.

Since early October, crude oil has lost around 30 percent of its value amid surging supply and fears that an economic downturn will erode fuel demand.

The Organisation of the Petroleum Exporting Countries (OPEC) is meeting at its headquarters in Vienna, Austria, on Thursday to decide its production policy.

Led by Saudi Arabia, OPEC’s crude oil production has risen by 4.1 percent since mid-2018, to 33.31 million barrels per day (bpd).

Oil output from the world’s biggest producers – OPEC, Russia and the United States – has increased by a 3.3 million bpd since the end of 2017, to 56.38 million bpd, meeting almost 60 percent of global consumption.

The increase alone is equivalent to the output of major OPEC producer United Arab Emirates.

Russia, a major oil producer but not a member of OPEC, will meet with the producer cartel on Friday to discuss production levels, and it is widely expected that a supply cut will be agreed.

“Markets…believe the production cut deal will be in range of 1-1.3 million bpd,” ANZ bank said on Thursday.

Gold edged higher on Thursday as growing risk aversion weighed on the dollar, while palladium held ground at a premium to the bullion. Spot gold was up 0.2 percent at $1,239.86 per ounce, as of 0429 GMT, while U.S. gold futures were 0.2 percent higher at $1,244.9 per ounce. “Markets are trying to consolidate, trying to push up higher for now,” said Benjamin Lu, a commodities analyst with Phillip Futures. The dollar declined against the safe-haven yen as a spike in risk aversion pressured equitie

Gold edged higher on Thursday as growing risk aversion weighed on the dollar, while palladium held ground at a premium to the bullion.

Spot gold was up 0.2 percent at $1,239.86 per ounce, as of 0429 GMT, while U.S. gold futures were 0.2 percent higher at $1,244.9 per ounce.

“Markets are trying to consolidate, trying to push up higher for now,” said Benjamin Lu, a commodities analyst with Phillip Futures.

A balance between a host of factors such as a rate hike by the U.S. Federal Reserve in December, uncertainty about trade tensions between Washington and Beijing, and a flattening yield curve has helped create a premium for the bullion, Lu added.

Fed policymakers will gather at a Dec. 18-19 meeting, at which the central bank is widely expected to raise interest rates.

“Although a rate hike is already priced in, markets will be closely watching the meeting for clues on rate hike timings in 2019,” said Lukman Otunuga, a research analyst at FXTM, adding that: “if the meeting echoes a similar message to (Chairman Jerome) Powell’s dovish shift, gold has the potential to shine into 2019.”

The dollar declined against the safe-haven yen as a spike in risk aversion pressured equities and U.S. Treasury yields. The spread between the two-year and five-year Treasury yields inverted this week and the two-year/10-year spread was at its flattest in more than a decade amid a sharp fall in long-term rates.

“An yield curve inversion indicates higher borrowing cost in short term, so for safe-haven assets in the longer run it’s going to be very positive,” Phillip Futures’ Lu said.

Spot gold may test a resistance at $1,245 per ounce, a break above which could lead to a gain into a range of $1,253-$1,258, according to Reuters technical analyst Wang Tao.

Meanwhile, palladium continued to be more valuable than gold after outshining the yellow metal for the first time since 2002 on Wednesday, with prices soaring by around 50 percent in less than four months to record levels.

Spot palladium rose 0.1 percent to $1,245.00 per ounce, hovering near its record high hit in the previous session.

The market now awaits Friday’s U.S. non-farm payrolls data for November, which is expected to show unemployment remains at 3.7 percent.

“Investors are seen adopting a cautious stance ahead of the U.S. jobs report which could offer insight over the health of the U.S. labour force,” said FXTM’s Otunuga.

Amongst other metals, silver fell 0.7 percent to $14.41 per ounce, while platinum extended losses into a third session, declining 0.7 percent to $795.00 per ounce.